Often we see headlines like the one above and think it's a gimmick. We dismiss the idea that someone would actually be able to buy a home unless they are able to put the traditional 20% down. The idea that a large down-payment is needed is a fairly common misconception. I have set down at the closing table with my buyers that did not bring a single dollar to close on their home. How is this possible? There are actually a few ways to buy a home without bringing money for a down-payment.
The first thing that comes to my mind when people ask me how they can buy a home with zero down is to tell them about a Rural Development loan. What is a Rural Development loan? It covers eligible suburban and rural home buyers (meaning: it is not available for all homes), but covers a wide range of areas including Bryant, Malvern, Alexander and many other areas. It's a 100%, no-money down mortgage loan backed by the U.S. Department of Agriculture (USDA). If you want to know more about the loan then this https://www.rd.usda.gov/programs-services/single-family-housing-guaranteed-loan-program is a great place to start or if you are wondering if an address would qualify for a RD loan then you can check the address here https://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do (click "Single Family Housing Guarantee" and then click "Property Eligibility")
Another loan that has 100% Financing is a VA loan. This type of loan is available via the Department of Veterans Affairs for veterans of the U.S. Armed Services. Obviously, this loan is not available to all buyers, but is very beneficial to those that qualify. If you have obtained a VA loan previously it is reusable so you may qualify for that type of loan again.
Do not be discouraged if you get approved for a loan that requires a down-payment, there are still options available for you. In Arkansaswe have the Arkansas Dream Down-Payment Initiative (ADDI) which is just another example of how you can own a home with zero down. With ADDI, qualifying Arkansans can be provided up to 6% of the purchase price of their home, not to exceed $10,000. If you stay in the home for five years then you never have to pay anything for the money you were given. It's forgiven! If you want to want to learn more about ADDI then visit here http://adfa.arkansas.gov/arkansas-dream-downpayment.
If you would like to learn more about buying or selling a home then I would love to talk to you!